Tallgrass Energy Partners (NYSE: TEP) and EQT Holdings Management (NYSE:EQGP) are both mid-cap oils/energy companies, but which is the superior business? We will compare the two companies based on the strength of their risk, analyst recommendations, valuation, profitability, dividends, earnings and institutional ownership.
Tallgrass Energy Partners pays an annual dividend of $3.90 per share and has a dividend yield of 9.1%. EQT Holdings Management pays an annual dividend of $1.03 per share and has a dividend yield of 4.2%. Tallgrass Energy Partners pays out 103.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. EQT Holdings Management pays out 105.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Tallgrass Energy Partners has increased its dividend for 4 consecutive years and EQT Holdings Management has increased its dividend for 2 consecutive years. Tallgrass Energy Partners is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Tallgrass Energy Partners has a beta of 1.02, meaning that its stock price is 2% more volatile than the S&P 500. Comparatively, EQT Holdings Management has a beta of 1.23, meaning that its stock price is 23% more volatile than the S&P 500.
This table compares Tallgrass Energy Partners and EQT Holdings Management’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Tallgrass Energy Partners||68.20%||30.04%||11.69%|
|EQT Holdings Management||32.58%||13.19%||8.14%|
Earnings and Valuation
This table compares Tallgrass Energy Partners and EQT Holdings Management’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Tallgrass Energy Partners||$655.90 million||4.80||$433.99 million||$3.77||11.41|
|EQT Holdings Management||$834.10 million||7.81||$261.99 million||$0.98||24.97|
Tallgrass Energy Partners has higher earnings, but lower revenue than EQT Holdings Management. Tallgrass Energy Partners is trading at a lower price-to-earnings ratio than EQT Holdings Management, indicating that it is currently the more affordable of the two stocks.
This is a summary of recent recommendations and price targets for Tallgrass Energy Partners and EQT Holdings Management, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Tallgrass Energy Partners||0||6||4||0||2.40|
|EQT Holdings Management||0||8||5||0||2.38|
Tallgrass Energy Partners currently has a consensus target price of $45.57, suggesting a potential upside of 5.91%. EQT Holdings Management has a consensus target price of $30.00, suggesting a potential upside of 22.60%. Given EQT Holdings Management’s higher probable upside, analysts plainly believe EQT Holdings Management is more favorable than Tallgrass Energy Partners.
Insider & Institutional Ownership
57.1% of Tallgrass Energy Partners shares are held by institutional investors. Comparatively, 10.4% of EQT Holdings Management shares are held by institutional investors. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
Tallgrass Energy Partners beats EQT Holdings Management on 10 of the 16 factors compared between the two stocks.
About Tallgrass Energy Partners
Tallgrass Energy Partners, LP acquires, owns, develops, and operates midstream energy assets in North America. It operates through Natural Gas Transportation; Crude Oil Transportation; and Gathering, Processing & Terminalling segments. The Natural Gas Transportation segment engages in the ownership and operation of interstate natural gas pipelines and integrated natural gas storage facilities with approximately 4,641 miles of transportation pipelines in Wyoming, Colorado, Kansas, Missouri, and Nebraska. This segment provides its services to on-system customers, including third-party local distribution companies, industrial users, and other shippers. The Crude Oil Transportation segment engages in the ownership and operation of the Pony Express System, a crude oil pipeline serving the Bakken Shale, Denver-Julesburg, and Powder River Basins, as well as other nearby oil producing basins. The Gathering, Processing & Terminalling segment owns and operates natural gas gathering and processing facilities that produce natural gas liquids (NGLs) and residue gas for sale in local wholesale markets or delivers into pipelines for transportation to additional end markets; and crude oil gathering, storage, and terminalling facilities, as well as engages in the transportation of NGLs, and marketing of crude oil and NGLs. This segment also provides water business services primarily to the oil and gas exploration and production industry. The company was founded in 2013 and is based in Leawood, Kansas.
About EQT Holdings Management
EQT GP Holdings, LP owns, operates, acquires, and develops midstream energy assets in the Appalachian Basin through owning partnership interests in EQT Midstream Partners, LP (EQM). The company operates in two segments, Gathering and Transmission. EQM offers natural gas transmission, storage, and gathering services to various third parties in Pennsylvania, West Virginia, and Ohio. As of December 31, 2017, it owned and operated 300 miles of high pressure gathering lines and 1,500 miles of Federal Energy Regulatory Commission (FERC)-regulated low pressure gathering lines. EQT GP Services, LLC serves as a general partner of the company. The company was founded in 2015 and is headquartered in Pittsburgh, Pennsylvania. EQT GP Holdings, LP is a subsidiary of EQT Gathering Holdings, LLC.
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